Dopamine, Discipline and Day Trading

The hormone and neutrotransmitter C8H11NO2 commonly know as Dopamine plays a major role in reward-motivated behaviour. In short, if we do something pleasurable our brain rewards us and we will seek to do that thing again to get that same reward. This could be something as simple as eating or having a winning day trade. We as humans are all hardwired to behave like this which is exactly the same as any animal such as a monkey. This can be a good thing and a bad thing especially when it comes to day trading.


Have you ever had the urge to get back into a trade after you’ve made a profitable trade and know you shouldn’t? Or have ever found that after a few profitable trades in one particular stock thinking that you could just trade this all the time? These decisions are highly probably driven not by logic but by the dopamine response system. As you’re going back to something that your brain associates with as being rewarding. Add in time pressure and the need to make decisions quickly and you're likely to resort to non-logic or non-intelligence based decisions.

If you can master yourself, you can master the world and the same can be said with the stock market. Understanding the origins of your decision and having the ability to differentiate between an emotionally based urge and an intelligent rational decision can be critical to your success as a Day Trader.

However with all of this being said its only one side of the coin. Having the discipline to adhere and execute your trading thesis and process is then also vitial to your success.

At TraderEquity, we are here to give you the trader the support, structures and processes needed to not only master yourself but master trading so you can be as profitable as possible.


Happy Trading!

 

Published 02/06/2019

Please Note: We can NOT accept any US-based traders, this restriction is based on their location rather than their nationality and we can NOT accept any Canadian based traders directly.




 

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